China Specifies Safe Harbor Provision for Certain Vertical Agreements

In this piece, authors Kevin B. Goldstein, Duoye Xu & Jeffrey J. Amato (Winston & Strawn) explore China’s revision of its Provisions on Prohibiting Monopoly Agreements, through which the State Administration for Market Regulation (SAMR) has, for the first time, specified concrete thresholds and conditions for applying the Anti-Monopoly Law’s Safe Harbor to vertical agreements. Effective February 1, 2026, the revised Provisions distinguish between resale price maintenance (RPM) agreements and other vertical arrangements, addressing long-standing uncertainty that persisted after the Safe Harbor was introduced in 2022 but left undefined in subsequent implementing rules.

The authors explain that the new framework imposes significantly stricter standards for RPM agreements than for other vertical agreements. RPM arrangements qualify for Safe Harbor protection only if all parties hold no more than a 5% market share in each relevant upstream and downstream market and generate less than RMB 100 million in annual turnover from the covered products, calculated on an aggregate basis where multiple parties are involved. By contrast, other vertical agreements benefit from a higher 15% market-share threshold in each relevant market and face no turnover requirement, subject to any special industry-specific rules that SAMR may adopt.

Finally, the piece highlights the procedural and practical effects of the Safe Harbor, which operates as a rebuttable presumption of legality rather than a blanket exemption. Businesses must affirmatively apply for Safe Harbor treatment during an investigation and submit detailed market, ownership, and turnover data. Even then, regulators retain discretion to reopen or continue investigations where information is incomplete, circumstances materially change, or evidence suggests the agreement restricts or eliminates competition…

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